ThredUP launches Stitch Fix competitor for try-before-you-buy clothes

Consignment startup thredUP is launching Goody Boxes, for people who want to try on clothes at home before making purchases. Customers will be able to order on-demand shipments, with personalized items sent to their home.

If it sounds familiar, it’s because Stitch Fix, Le Tote, Trunk Club and others have similar offerings. ThredUP hopes to differentiate itself with lower cost secondhand clothes.

The on-demand shipments are priced at $20 per delivery. Each box contains 10 to 20 items available for purchase at a discount.

ThredUP CEO James Reinhart said that they have 35,000 brands on the platform, providing more options than some of its competitors. Like Stitch Fix, he said they’ve built out machine learning capabilities to identify which outfits should be sent to which consumers.

The company realized that a try-before-you-buy box is a good way to handle excess inventory. They’ve been overwhelmed with sellers and this new service is designed to help demand match supply.

Yet ThredUP will still keep its core business in operation, with sellers sending bags full of clothing and accessories to be listed on the site. Some will be hand-selected for the Goody Boxes.

The company also has launched a couple of brick-and-mortar stores in Texas and California and plans to launch more in the first quarter of 2018.

ThredUP is “way past” a $100 million revenue run rate, but the company couldn’t disclose specifics. It’s not cash flow positive just yet.

Stitch Fix recently went public and quickly recovered from an unsuccessful launch. If the company continues to do well, it will be considered a favorable sign of investor sentiment for the industry. But with so many fashion boxes to choose from, it could be hard for all of them to prevail.